Enforcement of Judgments 2024

Last Updated July 19, 2024

Liechtenstein

Law and Practice
Trends and Developments

Law and Practice

Authors

Moritz Blasy

Nicolai Binkert

Simon Ott

Kathrin Binder

Schurti Partners Attorneys at Law Ltd advises clients on the Liechtenstein aspects of multi-jurisdictional disputes; its civil litigation and arbitration team is also often engaged to co-ordinate the steps to be taken in other jurisdictions. Over several decades, the firm has built up excellent working relations with foreign law firms that are also specialised in litigation/arbitration, and with barristers – a great asset in this context. Most members of Schurti Partners’ civil litigation and arbitration team are qualified in multiple jurisdictions, which is also a benefit in multi-jurisdictional disputes. The firm’s main areas of civil litigation and arbitration are disputes in trust and foundation matters, asset tracing, asset protection, disputes in corporate matters, directors’/trustees’ liability matters, disputes in insurance matters, disputes arising out of banking and finance transactions, and general commercial disputes.

1. Identifying Assets in the Jurisdiction

1.1 Options to Identify Another Party’s Asset Position

In Liechtenstein, public information on a person’s asset position is limited. However, there are a number of registers that may be of assistance in this regard, the most important of which are outlined below.

The Commercial Register (Handelsregister)

All legal entities that are established under Liechtenstein law and pursue commercial activities must be registered with the Commercial Register, and most types of legal entities must be registered with the Commercial Register regardless of whether or not they pursue commercial activities. However, there are certain (practically important) exemptions to this rule. Most significantly, Liechtenstein foundations do not have to be registered with the Commercial Register unless they are charitable or pursue commercial activities. Therefore, the vast majority of Liechtenstein private foundations are not registered with the Commercial Register.

The Commercial Register contains, amongst other things, information on a legal entity’s statutory capital, its purpose and its directors. Furthermore, all stock companies (Aktiengesellschaften), limited liability companies (Gesellschaften mit beschränkter Haftung) and Societas Europaea are required to file their annual financial statements with the Commercial Register. However, the Commercial Register does not contain information on the shareholders of a company, except in the case of limited liability companies (which are not very common in Liechtenstein).

The Commercial Register is public and can be inspected by anyone, without the need to show any specific legal interest.

The Beneficial Ownership Register (Verzeichnis der wirtschaftlich berechtigten Personen von Rechtsträgern)

The Beneficial Ownership Register contains information on the “beneficial owners” (within the meaning of Liechtenstein anti-money laundering legislation) of all legal entities established in Liechtenstein.

Unlike the Commercial Register, the Beneficial Ownership Register is not open to the public. In principle, it may only be inspected by interested persons if they can show that inspection is required for purposes of combating money laundering or terrorist financing.

The Land Registry (Grundbuch)

The Land Registry is a register comprising all properties (real estate) in Liechtenstein and contains information on ownership, servitudes, mortgages, etc.

All information except information on mortgages is public and may be inspected without the need to show any specific legal interest. However, the Land Registry can only be inspected with respect to specific properties. It is not possible to search it for all properties owned by a particular person.

The Seizure Register (Pfändungsregister)

All seizures of movable assets are registered in a register kept by the Liechtenstein District Court. The register contains information on the creditors, the debtors, the enforced claims, the dates of the seizures, and the assets concerned.

The Seizure Register can be accessed by anyone who can show that they require the information for the initiation of legal proceedings, for the purpose of enforcing a claim, or for other important reasons.

Asset Disclosure Orders

More detailed information on another party’s asset position can be obtained through asset disclosure orders issued in the course of enforcement proceedings. For example, although a creditor is required to specify the assets against which enforcement is sought in the enforcement application, in the case of bank accounts it is acceptable in practice for a creditor to describe the assets as “all bank accounts” held by the debtor with a particular bank (without having to specify the details of the bank account(s)), and the bank can then be ordered by the court to disclose the bank accounts held by the debtor. Also, if the enforcement of a monetary judgment remains unsuccessful because no realisable assets can be found, the debtor can be ordered by the court to submit a statement of all their assets to the court, upon the application of the creditor. Failure to comply with such an order constitutes a criminal offence under Liechtenstein law.

Injunctive Relief

Information on another party’s asset position can also be obtained through injunctive relief. Under Liechtenstein law, injunctive relief can be obtained to prevent irreparable damage or a change in circumstances that might frustrate or significantly complicate enforcement of a claim or right at a later stage. In such cases, injunctive relief can be granted in the form of preservative measures in order to preserve the matter in dispute or otherwise secure future enforcement pending conclusion of the main proceedings, for example by means of freezing orders, seizures or restraining orders. Even in cases where future enforcement is not a concern, injunctive relief can be granted in the form of regulatory measures in order to regulate the parties’ relationship pending conclusion of the main proceedings, if it is feared that irreparable damage would otherwise occur.

Applications for injunctive relief can be made prior to the initiation of a lawsuit, simultaneously with a statement of claim initiating a lawsuit, or during a pending lawsuit whenever the need arises, even at the stage of enforcement. In the application, the applicant needs to:

show a prima facie case (eg, a claim whose enforcement needs to be secured) supported by prima facie evidence;
show reasons justifying injunctive relief (ie, a risk of irreparable damage or irreversible change in circumstances); and
specify the injunctive measure sought.

Liechtenstein statutory law does not explicitly restrict injunctive relief to assets located in Liechtenstein. Thus, injunctive measures can be ordered with respect to assets outside the jurisdiction. It is then a question of the laws applicable in the jurisdictions where the relevant assets are located as to whether an order of a Liechtenstein court will be enforceable there.

As a rule, injunctive measures can only be imposed on the applicant’s counterparty, but injunctive relief can be ordered against third parties as far as it relates to a relationship (contractual or other) between the third party and the applicant’s counterparty. For example, a third party who holds assets of the applicant’s counterparty (eg, a bank) can be ordered not to dispose of the respective assets and, in this context, the third party can also be ordered to provide information on the applicant’s counterparty’s assets held with the third party.

2. Domestic Judgments

2.1 Types of Domestic Judgments

Liechtenstein courts can render the following judgments:

those ordering performance of a certain action – eg, payment of a certain sum of money or the handing over of a specific asset;
those forbidding a certain action;
those creating or altering legal status – eg, divorces, annulments of corporate resolutions; or
those of a declaratory nature.

In principle, courts are bound by the relief sought and may not order more or something different than what is requested by the applicant.

A claimant may apply for a partial judgment (Teilurteil) if one or more of several claims brought in a lawsuit are acknowledged by the defendant. Furthermore, the court may issue a partial judgment if, in the case of a claim and a counterclaim, only one of the two claims is ready to be disposed of while a decision on the other claim requires the taking of further evidence.

An interlocutory judgment (Zwischenurteil) can be issued in cases where a claim has been disputed in terms of both its basis and its extent, and the court concludes that the case permits a decision as to the basis but not yet as to the extent of the claim.

If a defendant fails to appear at the first hearing despite having been properly served with the summons, the claimant may apply for a default judgment (Versäumnisurteil). The court will render a judgment in favour of the claimant if the presented evidence does not obviously contradict the facts pleaded in the statement of claim and if the pleaded facts support the remedy sought. Significantly, written submissions of the defendant submitted prior to the first hearing must not be taken into account by the court if the defendant does not appear at the hearing. A default judgment can be attacked in two ways: by means of an appeal to the Court of Appeal and by means of an application for restitutio in integrum to the District Court.

2.2 Enforcement of Domestic Judgments

The enforcement of judgments in Liechtenstein is governed by the Liechtenstein Enforcement Act (Exekutionsordnung), which sets forth different rules for the enforcement of monetary judgments (ie, judgments ordering the debtor to pay a certain sum of money) and non-monetary judgments (ie, judgments ordering the debtor to perform, or refrain from, a certain action).

Monetary Judgments

In the case of monetary judgments, different rules apply depending on the type of asset against which enforcement is sought. In particular, the Enforcement Act distinguishes between enforcement against immovable assets (unbewegliches Vermögen) and enforcement against movable assets (bewegliches Vermögen), including enforcement against movables (körperliche Sachen), against receivables (Geldforderungen), against claims for the delivery of tangible assets (Ansprüche auf Herausgabe und Leistung körperlicher Sachen) and against other pecuniary rights (andere Vermögensrechte) of the debtor.

In the case of immovable assets, enforcement is done at the creditor’s choice by way of compulsory creation of a lien (zwangsweise Pfand-rechtsbegründung), compulsory administration (Zwangsverwaltung) or compulsory sale by auction (Zwangsversteigerung).

In the case of movables, enforcement takes place by way of seizure (Pfändung), appraisal (Schätzung) and sale (Verkauf).

In the case of receivables and other pecuniary rights, enforcement occurs through seizure (Pfändung) and transfer (Überweisung) of the receivables or other rights to the creditor in order to enable the creditor to request fulfilment of the receivable from the third-party debtor or to otherwise exercise the transferred right on behalf of the judgment debtor. Similarly, in the case of enforcement against claims for the delivery of tangible assets, the claims are seized and transferred to the creditor, and once the assets have been delivered by the third party debtor they will be realised according to the rules applicable to enforcement against immovable assets or movable assets, as applicable.

Non-monetary Judgments

Non-monetary judgments (ie, judgments ordering the debtor to perform, or refrain from, specific actions) are enforced by means of delivery (Herausgabe bestimmter beweglicher Sachen), eviction (Überlassung oder Räumung von unbeweglichen Sachen), entry into the Land Registry (Eintragung im Grundbuch),entry into the custodian’s register regarding bearer shares (Eintragung in das vom Verwahrer geführte Register betreffend Inhaberaktien), substitute performance (if the relevant action can be performed by another person) or fines and even imprisonment (if the relevant action cannot be enforced by another person or if the judgment debtor violates an obligation to refrain from a specific action).

Enforcement procedures are initiated by way of an enforcement application by the creditor. In the application, the creditor must specify the creditor and the debtor, the claim to be enforced (including the enforceable title on which the claim is based), the means of enforcement and the particular assets against which enforcement is sought.

If all requirements are fulfilled, the court will issue the enforcement order ex parte – ie, without hearing the debtor. Once the enforcement order has been issued, the debtor can appeal it within 14 days of service. Likewise, if the court dismissed the enforcement application, the creditor can file an appeal within 14 days of service. As a matter of law, an appeal of a debtor against an enforcement order does not have suspensive effect but the court has discretion to stay enforcement pending appeal upon the application of the appellant if it is of the view that the purpose of the appeal would otherwise be defeated.

If the debtor does not appeal the enforcement order or if the court does not stay enforcement pending appeal, the procedure will continue with the actual enforcement. The enforcement is taken care of by court officers (Gerichtsvollzieher) and the particular steps to be taken depend on the means of enforcement and the assets against which enforcement is sought.

2.3 Costs and Time Taken to Enforce Domestic Judgments

The costs involved in enforcing a judgment in Liechtenstein typically comprise attorneys’ fees, court fees and, as the case may be, costs related to the relevant means of enforcement. While it is difficult to give a general indication of attorneys’ fees and the costs related to the means of enforcement, given that much depends on the circumstances of the case, the court fees merely depend on the amount of the claim to be enforced, and range between CHF10 and CHF3,400.

In terms of timing, while an enforcement order can usually be obtained relatively quickly (the process being ex parte), the length of the actual enforcement process depends on the means of enforcement and the assets against which enforcement is sought. Also, enforcement orders can be appealed by the debtor and, even though an appeal against an enforcement order does not have suspensive effect as a matter of law, the court has discretion to stay enforcement pending appeal upon the application of the appellant if it is of the view that the purpose of the appeal would otherwise be defeated. A stay of enforcement pending appeal may delay the enforcement procedure by several months, or even more than a year.

2.4 Post-judgment Procedures for Determining Defendants’ Assets

A creditor seeking enforcement of a judgment must specify in the enforcement application with reasonable detail the means of enforcement and the assets against which enforcement is sought. However, that does not mean that a creditor is required to describe the relevant assets in full detail. Rather, it is sufficient for a creditor to describe the assets in a general manner, such as “all chattels in the possession of the debtor” or “all bank accounts” held by the debtor with a particular bank. In the latter case, the bank can then be ordered by the court to disclose all bank accounts held by the debtor with the bank.

Furthermore, if the enforcement of a monetary judgment remains unsuccessful because no realisable assets can be found, debtors can be ordered by the court to submit a statement of all their assets to the court. Failure to comply with such an order constitutes a criminal offence under Liechtenstein law.

2.5 Challenging Enforcement of Domestic Judgments

Enforceable Judgments

Only “enforceable” judgments can be enforced under the Liechtenstein Enforcement Act. A judgment or order is enforceable if an appeal is no longer available or, if an appeal is available, the appeal does not have suspensive effect as a matter of law and the court does not grant a stay of enforcement.

Once a judgment is enforceable, the judgment creditor can apply for an enforcement order. The enforcement order can be appealed by the debtor within 14 days of service. An appeal against an enforcement order does not have suspensive effect as a matter of law but the court has discretion to stay enforcement pending appeal upon the application of the appellant if it is of the view that the purpose of the appeal would otherwise be defeated.

Other Remedies

In addition to an appeal against the enforcement order, there are a number of other remedies available to debtors that may lead to a temporary stay and, if successful, even the (full or partial) termination of the enforcement proceedings, as follows.

A debtor can file a so-called opposition claim (Oppositionsklage) in order to raise substantive objections against the claim that is sought to be enforced on the basis of circumstances that have occurred after the judgment that is sought to be enforced was rendered – eg, that the claim has ceased to exist (because it has already been satisfied (erfüllt) or because the debt was acquitted (erlassen), etc) or that the claim has become temporarily unenforceable (eg, because the creditor has granted a temporary deferral of performance). If the debtor succeeds with the opposition claim, the enforcement procedure will be terminated. Also, the court can stay enforcement pending the opposition claim if it is of the view that the purpose of the opposition claim would otherwise be defeated.
A debtor can file a claim for the cancellation of an enforcement order (Impugnationsklage) in order to challenge the enforcement order on formal grounds (eg, that the claim is not yet mature or enforceable, or that the creditor has waived the right to enforce the judgment). If the debtor succeeds with the claim, the enforcement procedure will be terminated and the court can stay enforcement pending the claim if it is of the view that the purpose of the claim would otherwise be defeated.

Third parties may also challenge enforcement proceedings if they are of the view that the enforcement concerns assets that belong to them rather than the debtor (so-called Exszindierungsklage). Such an action may also lead to a stay of the enforcement proceedings and, if successful, to the termination of the enforcement procedure with respect to the relevant assets.

2.6 Unenforceable Domestic Judgments

Only judgments ordering the performance or omission of a certain action (Leistungsurteile) can be enforced. Judgments creating or altering legal status (Rechtsgestaltungsurteile) and declaratory judgments (Feststellungsurteile) cannot be enforced (and, by definition, do not need to be enforced).

2.7 Register of Domestic Judgments

There is no central register of judgments in Liechtenstein. However, all seizures of movable assets are registered in a register kept by the Liechtenstein District Court. The register contains information on the creditors, the debtors, the enforced claims, the dates of the seizures and the assets concerned.

3. Foreign Judgments

3.1 Legal Issues Concerning Enforcement of Foreign Judgments

Judgments of foreign courts are only enforceable in Liechtenstein if and to the extent such has been agreed in international treaties, or if reciprocity is guaranteed by international treaties or by declarations of reciprocity issued by the Liechtenstein government.

Therefore, judgments of foreign courts other than Austria and Switzerland, and other than child support judgments, are not enforceable in Liechtenstein. However, such foreign judgments can serve as a basis to obtain a summary judgment through summary proceedings (so-called Rechtsöffnungsverfahren).

Summary proceedings are initiated by an application for a payment order (Zahlbefehl) with the District Court. Once the payment order has been served on the defendant, the defendant has two weeks to file an objection to it. Neither the application for a payment order nor the objection to a payment order need to be substantiated.

If no objection is filed, the payment order becomes final and binding and can then be enforced like a final court judgment. On the other hand, if an objection is filed, the applicant can make an application for the setting aside of the objection (so-called Rechtsöffnung) with the District Court. Such application must be based either on an acknowledgement of debt by the defendant or a public deed evidencing the applicant’s claim against the defendant. This is where the (non-enforceable) foreign judgment comes into play: A foreign judgment, even if it is not enforceable in Liechtenstein, is, in principle, considered a public deed and can, therefore, serve as a basis for an application to lift an objection against a payment order.

If the application for the lifting of the objection is granted, the defendant must either file a constitutional complaint against the order lifting the objection with the Liechtenstein Constitutional Court within four weeks of service or file a claim against the applicant with the District Court requesting a declaratory judgment to the effect that the applicant’s alleged claim does not exist (so-called Aberkennungsklage) within 14 days of service in order to avoid that the order lifting the objection becomes final and binding and, thus, enforceable like a court judgment. The proceedings initiated by such claim are ordinary civil proceedings and the court will, therefore, fully reassess the claim on the merits without being bound to the (non-enforceable) foreign judgment which served as a basis for the application to lift the objection against the payment order. However, the roles of the creditor and the debtor are interchanged in that the debtor is now the claimant and the creditor is now the defendant. This has the advantage for the creditor that as defendant, he/she/it cannot be ordered to post security for costs. Instead, the debtor as claimant can be ordered to do so. However, the burden of proof remains the same and is not affected by the interchanged roles of the parties.

Unlike an order granting an application for the lifting of an objection against a payment order, an order dismissing such application can be appealed with the Liechtenstein Court of Appeal within 14 days of service. If an application for the lifting of an objection against a payment order is conclusively dismissed, the creditor has no choice but to initiate new ordinary civil proceedings in Liechtenstein in order to enforce his/her/its claim against the debtor, and the Liechtenstein courts will then fully reassess the claim on the merits without being bound to the (non-enforceable) foreign judgment that served as a basis for the application to lift the objection against the payment order.

Thus, the initiation of summary proceedings may make sense if a creditor of a non-enforceable foreign judgment seeks to avoid being ordered to post security for costs, which can be quite substantial depending on the amount in dispute, or if it is expected that the debtor will be unwilling or unable to mount an extensive defence in Liechtenstein. On the other hand, the initiation of summary proceedings can considerably delay matters from a creditor’s perspective as they cannot avoid a full re-litigation on the merits if persistently defended by the debtor.

3.2 Variations in Approach to Enforcement of Foreign Judgments

Liechtenstein has entered into bilateral treaties regarding the mutual acknowledgement and enforcement of foreign judgments with the Republic of Austria and the Swiss Confederation only. In addition, Liechtenstein is a party to the Hague Convention on Child Support. Therefore, judgments of foreign courts other than Austria and Switzerland, and other than child support judgments, are not directly enforceable in Liechtenstein.

3.3 Categories of Foreign Judgments Not Enforced

The bilateral treaties concluded with the Republic of Austria and the Swiss Confederation only apply to judgments in civil matters. Also, both treaties exclude certain subject matters from their ambit, such as bankruptcy matters, and certain types of decisions, such as decisions on civil law claims entered in criminal proceedings, interim injunctions or regulatory fines.

3.4 Process of Enforcing Foreign Judgments

To the extent a foreign judgment is enforceable in Liechtenstein, because one of the aforementioned treaties applies and the conditions set forth therein are fulfilled, the procedure to enforce the foreign judgment is similar to the procedure to enforce a domestic judgment. In particular, a creditor can apply directly for an enforcement order based on a foreign judgment without first having to apply for the foreign judgment to be formally recognised.

The main difference between enforcement on the basis of a domestic judgment and enforcement on the basis of a foreign judgment is that, in the latter case, the Enforcement Act provides for a special opposition procedure (Widerspruchsverfahren) in which the debtor can raise objections specifically (and only) available against the enforcement of foreign judgments, with the following examples:

that the debtor did not have an opportunity to participate in the foreign proceedings;
that the action that shall be enforced based on the foreign judgment is unlawful as a matter of Liechtenstein law;
that the foreign judgment violates Liechtenstein public policy (ordre public); or
that the conditions set forth in the relevant treaty are not fulfilled.

The opposition is to be raised with the Liechtenstein District Court (ie, the court of first instance) and is to be dealt with in an oral hearing. The opposition can be raised in parallel to an appeal against the enforcement order with the Liechtenstein Court of Appeal.

3.5 Costs and Time Taken to Enforce Foreign Judgments

In principle, the procedure to enforce a foreign judgment is the same as the procedure to enforce a domestic judgment. Therefore, court fees are also the same, ranging between CHF10 and CHF3,400, depending on the amount of the claim to be enforced.

However, in practice, the enforcement of a foreign judgment often turns out to be more time-consuming and therefore more expensive (in terms of attorneys’ fees) than the enforcement of a domestic judgment because additional challenges specifically available against the enforcement of foreign judgments may be raised by the debtor.

3.6 Challenging Enforcement of Foreign Judgments

The treaties concluded with the Republic of Austria and the Swiss Confederation set forth certain conditions that must be fulfilled in order for a judgment of the other jurisdiction’s courts to be recognised and enforceable. In particular, under both treaties, recognition and enforcement is only permissible if:

the recognition and enforcement do not violate the public policy of the jurisdiction in which they are sought;
the court that rendered the judgment for which recognition and enforcement are sought had jurisdiction according to the rules set forth in the treaties;
the judgment for which recognition and enforcement are sought is final and binding; and
in the case of a default judgment, the document instituting the proceedings that led to the default judgment was served on the defendant in a timely manner.

An objection to the enforcement of a foreign judgment in Liechtenstein on the grounds that one of the aforementioned conditions is not fulfilled is to be raised by the defendant by way of an opposition (Widerspruch) against the enforcement order. The opposition is to be made within 14 days of service of the enforcement order on the defendant, and is to be raised with the Liechtenstein District Court, which has to deal with the opposition in an oral hearing. An opposition can be raised in parallel to an appeal against the enforcement order with the Liechtenstein Court of Appeal.

4. Arbitral Awards

4.1 Legal Issues Concerning Enforcement of Arbitral Awards

Arbitral awards of arbitral tribunals with their seat in Liechtenstein are deemed by law to have the effect of final and binding judgments of the ordinary Liechtenstein courts and, therefore, are enforceable like judgments of the ordinary courts.

The enforcement of foreign arbitral awards in Liechtenstein is governed by the provisions of the New York Convention, which Liechtenstein signed and ratified in 2011.

4.2 Variations in Approach to Enforcement of Arbitral Awards

A distinction is to be drawn between domestic and foreign arbitral awards. While domestic arbitral awards are deemed by law to have the effect of final and binding judgments of the ordinary Liechtenstein courts, and are therefore enforceable just like judgments of the ordinary courts, the enforcement of foreign arbitral awards in Liechtenstein is governed by the provisions of the New York Convention.

4.3 Categories of Arbitral Awards Not Enforced

The enforcement of foreign arbitral awards in Liechtenstein is governed by the provisions of the New York Convention. Foreign arbitral awards that do not fall within the ambit of the New York Convention are not enforceable in Liechtenstein.

4.4 Process of Enforcing Arbitral Awards

To the extent an arbitral award is enforceable in Liechtenstein (because it is a Liechtenstein arbitral award or a foreign arbitral award that falls within the ambit of the New York Convention), the enforcement procedure, in principle, is the same as for judgments of the ordinary courts. In particular, in the case of a foreign arbitral award, a creditor can apply directly for an enforcement order based on the foreign arbitral award without first having to apply for the foreign arbitral award to be formally recognised.

The main difference between enforcement on the basis of a domestic arbitral award and enforcement on the basis of a foreign arbitral award is that, in the latter case, the Enforcement Act provides for a special opposition procedure (Widerspruchsverfahren) in which the debtor can raise objections that are specifically (and only) available against the enforcement of foreign arbitral awards – eg, that the conditions set forth in the New York Convention are not fulfilled, or that the foreign arbitral award violates Liechtenstein public policy (ordre public).

The opposition is to be raised with the Liechtenstein District Court and is to be dealt with in an oral hearing. An opposition can be raised in parallel to an appeal against the enforcement order with the Liechtenstein Court of Appeal.

4.5 Costs and Time Taken to Enforce Arbitral Awards

In principle, the procedure to enforce an arbitral award is the same as the procedure to enforce a judgment of the ordinary courts. Therefore, court fees are also the same, ranging between CHF10 and CHF3,400, depending on the amount of the claim to be enforced.

However, in practice, the enforcement of a foreign arbitral award often turns out to be more time-consuming and therefore more expensive (in terms of attorneys’ fees) than the enforcement of a domestic arbitral award because additional challenges that are specifically available against the enforcement of foreign arbitral awards may be raised by the debtor.

4.6 Challenging Enforcement of Arbitral Awards

If an award has been set aside by the courts in the seat of arbitration in a binding decision, said award cannot be enforced in Liechtenstein under the New York Convention. It is up to the party against whom enforcement is sought to argue and prove that the award has been set aside in a binding decision. The mere challenge of the award does not constitute an obstacle to recognition.

According to Liechtenstein case law, the New York Convention must be interpreted in a manner supporting the arbitration and enforcement thereof. The public policy grounds must reach a high threshold in order for the enforcement of an arbitral award to be impeded. Not every deviation from Liechtenstein law constitutes a violation of public policy – a severe violation of the fundamental values of the Liechtenstein legal order as a whole is required. Therefore, the public policy exemption is applied extremely restrictively.

Schurti Partners Attorneys at Law Ltd

Zollstrasse 2,
9490,
Vaduz,
Liechtenstein.

+41 44 244 2000

+41 44  244 2100

mail@schurtipartners.com www.schurtipartners.com

Trends and Developments

Authors

Patrick Roth

Benjamin Hartmann

Matthias Frommelt

Tobias Beck

Roth+Partner is a full-service international law firm comprising seven attorneys and four legal associates. Based in Triesen, Liechtenstein, Roth+Partner has an excellent network of partner law firms abroad, enabling the firm to handle cases involving multiple international jurisdictions. Its litigation and arbitration team specialises in international civil disputes, often dealing with corporate law issues related to trusts, foundations, or other legal entities. This specialisation in international disputes also means that the firm regularly undertakes mandates involving the enforcement of claims against complex asset structures in Liechtenstein. Additionally, Roth+Partner provides counsel on matters such as white-collar crime, Liechtenstein tax, real estate, and financial markets law.

Identifying Assets

Options to identify another party’s asset position

In Liechtenstein, there are only limited ways to access publicly available information about the assets of a specific natural or legal person. However, there are various registers – that are more or less publicly accessible – that can be helpful in such cases.

In the course of identifying any potential assets of a specific person (asset tracing), the first step is to differentiate whether the subject is a natural person (individual) or a legal person (entities such as companies, foundations and associations).

The Commercial Register (Handelsregister)

If a legal entity is involved, usually the first register to consult is the commercial register, which is maintained by the Office of Justice in Vaduz. All legal entities subject to Liechtenstein law and operating a business in a commercial manner must be registered with the commercial register. There are exceptions for certain businesses, provided they do not exceed an annual turnover of CHF300,000.

Liechtenstein foundations are only required to register in the commercial register if they pursue a charitable purpose or operate a business in a commercial manner. Therefore, most private-benefit foundations in Liechtenstein are not registered in the commercial register.

Additionally, all companies limited by shares (AG), limited liability companies (GmbH), and societas europaea (SE) must submit their annual accounts to the commercial register.

The commercial register extract available from the Office of Justice includes the name or company title, statutory capital, purpose, management, address, location, company number, date of registration, and legal form of the legal entity. If an entity is in liquidation or bankrupt, this is indicated alongside the name of this entity. To access this information, a commercial register extract can be ordered from the Office of Justice for a fee of CHF10 to CHF20. The commercial register is publicly accessible, and an extract can be obtained by anyone without the need to demonstrate a specific interest. Additionally, an entity’s name or company title, address, location, company number, date of registration and legal form are publicly available on the Commercial Register’s website.

Furthermore, it is generally possible to order the complete registry file regarding a specific entity from the Office of Justice in addition to the commercial register extract. This file includes registrations as well as supporting documents. It encompasses, notably, public documents concerning amendments to statutes, as well as the annual accounts (if such are submitted to the commercial register). In practice, this registry file often yields interesting information.

The Land Registry (Grundbuch)

The land registry is a public register in which all real estate properties (eg, land, real estate, condominium ownership, independent building rights) and the rights in rem (dingliche Rechte) associated with them are recorded. This register includes information about ownership, servitudes, mortgages, etc. All information, except for details concerning mortgages, is publicly accessible. Therefore, anyone can order and examine a land registry excerpt for a specific property without having to demonstrate a specific interest. However, searches must always be directed at a specific property. It is not possible to gain information about all properties owned by a specific person.

The Seizure Register (Pfändungsregister)

The seizure register (Pfändungsregister) contains information about officially ordered seizures against the assets of a specific person. A seizure register extract can be accessed or ordered by third parties from the District Court, provided they credibly demonstrate that they need this information due to a legal dispute, an execution, or for other important reasons. This extract includes details about the creditors, the claims enforced, the dates of the seizures and the affected assets.

The Beneficial Ownership Register (Verzeichnis der wirtschaftlich berechtigten Personen)

The register of beneficial owners is maintained for the purpose of preventing money laundering and terrorist financing. It contains data on the beneficial owners of legal entities such as companies, foundations, and trusts. Unlike the commercial register, the register of beneficial owners is generally not publicly accessible. Disclosure of the data recorded in the register of beneficial owners can be electronically requested from the Office of Justice for a fee. However, such information is only provided if legitimate interests are demonstrated and it is shown that the request pertains to the fight against money laundering or terrorism.

Additional options

In cases where insolvency proceedings have been initiated against a specific legal entity, it may be possible to request access to the files of the relevant insolvency proceedings before the District Court. Typically, in such cases, as creditor it makes sense to register the claim against the debtor within this proceeding, making the creditor a party to the insolvency proceedings. As such a party, a creditor is generally entitled to access the files to a certain extent.

In addition, it should be mentioned that in Liechtenstein it is not possible to obtain information on whether a specific individual is a party to a pending proceeding before the District Court, nor can any related information be obtained. According to current practices, the District Court denies such requests for information.

Obtaining information through asset disclosure orders

In cases where a creditor has a legally binding and enforceable title in Liechtenstein, an execution permit (Exekutionsbewilligung) can be requested against a debtor residing or based in Liechtenstein. In the course of such enforcement proceedings, additional information can be obtained. Accordingly, it is sufficient to name a specific bank, and the court will then instruct the bank to disclose any bank accounts held by the debtor.

Obtaining information while securing assets

Aside from the previously described option of initiating enforcement proceedings, there are also possibilities to secure assets or claims using injunctions and to obtain information through such injunctions.

Under Liechtenstein law, provisional orders (Sicherungsbote/Amtsbefehle) can be issued to secure monetary or other claims if it is likely that, without such measures, the debtor could prevent or complicate the collection of the money or if the realisation of the claim would otherwise be thwarted or significantly hindered. In such cases, provisional legal protection in the form of provisional orders (injunctions) can be granted to preserve assets or secure the future enforcement. Applications for such injunctions can be made before filing a lawsuit, simultaneously with the filing of a lawsuit, or during a pending civil proceeding.

Generally, provisional orders can only be imposed against the opposing party of the applicant, but some provisional measures can also be ordered against third parties. For example, a third party holding assets of the applicant’s opposing party (eg, a bank) can be ordered not to dispose of the relevant assets, and, in this context, the third party can also be instructed to provide information about the assets held by the applicant’s opposing party.

Domestic Judgements

Types of domestic judgements

Liechtenstein courts are generally bound by the relief sought and may not order more or something different than that requested by the applicant.

The courts can render the following types of judgments.

Performance judgments, which order a party to perform a specific action, such as paying a sum of money or transferring an asset.
Prohibitory judgments, which forbid a specific action.
Status-altering judgments, which create or alter legal status, such as divorces or annulments of corporate resolutions.
Declaratory judgments, which declare the rights or legal status of the parties without ordering any action.

According to the Liechtenstein Code of Civil Procedure (Zivilprozessordnung), the court has the final judgement (Endurteil), partial judgement (Teilurteil), interlocutory judgement (Zwischenurteil), judgement of renunciation (Verzichtsurteil), judgement by confession (Anerkenntnisurteil) and default judgement (Versäumnisurteil) at its disposal.

A default judgement may be rendered against both the claimant and the defendant, and only upon the express request of the person appearing at the first hearing. If, for example, the evidence presented by the claimant does not obviously contradict the facts presented in the claim, the court will issue a judgement in favour of the claimant. It should be noted that the court may not consider written submissions made by the defendant before the first hearing if the defendant does not appear at the hearing. A default judgement can only be contested by appeal to the Court of Appeal. In addition, an application for restitutio in integrum may be filed to the District Court if the relevant requirements are met.

Enforcement of domestic judgements

The enforcement of judgements in Liechtenstein is governed by the Liechtenstein Enforcement Act (Exekutionsordnung). The Enforcement Act makes a distinction between the enforcement of monetary judgements and non-monetary judgements. In the case of a monetary judgement, the debtor is obliged to pay a certain amount of money. In the case of non-monetary judgements, the debtor is obliged to perform or refrain from performing a specific action.

Monetary judgements

In the case of monetary judgments, the Enforcement Act distinguishes between the enforcement against movable and immovable assets, including enforcement against receivables (Geldforderungen), against claims for the delivery of tangible assets (Ansprüche auf Herausgabe und Leistung körperlichen Sachen) and against other pecuniary rights (andere Vermögenswerte) of the debtor.

In the case of immovable assets, the creditor has the choice between the compulsory creation of a lien (zwangsweise Pfandrechtsbegründung), compulsory administration (Zwangsverwaltung) or compulsory sale by auction (Zwangsversteigerung).

In the case of movable property, enforcement is carried out by seizure (Pfändung), appraisal (Schätzung) and sale (Verkauf).

Non-monetary judgments

Non-monetary judgements, ie, judgements ordering the debtor to perform or refrain from specific actions, are enforced by eviction (Überlassung oder Räumung von unbeweglichen Sachen), substitute performance (if the relevant action can be performed by another person) or fines and even imprisonment (if the relevant action cannot be enforced by another person or if the debtor violates an obligation to refrain from a specific action).

Enforcement proceedings

Enforcement proceedings are initiated by an application for enforcement filed by the creditor. The creditor’s application must contain the following information:

the creditor;
the debtor;
the claim to be enforced (including the enforceable title on which the application is based);
the enforcement measure; and
the assets against which enforcement is to be obtained.

If all requirements are fulfilled, the court issues the enforcement permit without hearing the debtor. The debtor may lodge an appeal to the enforcement permit within 14 days of service. According to the law, the appeal does not have suspensive effect. However, the court has discretion to suspend enforcement upon the application of the debtor, if the purpose of the appeal would otherwise be frustrated.

If the debtor does not appeal the enforcement permit or the court does not suspend enforcement until the appeal proceedings have been concluded, the enforcement proceedings will continue with the actual enforcement. Enforcement is carried out by court officers (Gerichtsvollzieher). The individual steps depend on the means of enforcement and the assets against which enforcement is sought.

Costs and time taken to enforce domestic judgments

The costs of enforcing a judgement in Liechtenstein depend on the circumstances of the individual case. Therefore, no precise cost estimation can be provided. The court fees are based on the amount of the claim to be enforced and range between CHF10.00 and CHF3,400.00. Additionally, attorney fees and, potentially, enforcement-specific costs will apply. These costs mainly depend on the duration of the enforcement proceedings, the nature of the means of enforcement and the type of the judgement. Consequently, monetary claims are relatively straightforward to enforce, whereas non-monetary claims are more challenging to enforce, and may therefore incur higher costs.

The enforcement permit can be obtained quickly, as it is rendered without hearing the debtor. However, the duration of the enforcement proceedings (also) varies, depending on the means of enforcement applied for and the assets against which enforcement is sought. Enforcement permits can be appealed by the debtor. Although an appeal does not have suspensive effect, the court has discretion to suspend enforcement at the application of the appellant if the purpose of the appeal would otherwise be frustrated. If enforcement is suspended, the proceedings may be delayed by several months or even more than a year.

Post-judgment proceedings for determining defendants’ assets

Although the creditor must provide adequate details of the means of enforcement and the assets of the debtor against which enforcement is sought in the application for an enforcement permit, a full description of the assets is not required. It is sufficient for the creditor to state that all movable assets in the possession of the debtor and/or all bankable assets held by the debtor at a Liechtenstein-located bank are to be attached. The bank is then instructed by the court to submit a third-party debtor declaration (Drittschuldneräusserung) and to disclose all assets held by the debtor with bank.

If the debtor appears to have no enforceable assets, the debtor may be required, upon the creditor’s application, to provide a comprehensive declaration of assets (Vermögensverzeichnis). Under threat of criminal punishment, the debtor is obliged to disclose all assets in this declaration.

Challenging enforcement of domestic judgments

The debtor may appeal against the enforcement permit within 14 days of service. An appeal against an enforcement permit has no suspensive effect by law, but the court may suspend enforcement at the application of the debtor if the purpose of the appeal would otherwise be frustrated.

As the District Court does not examine the substantive requirements of the claim, it is up to the debtor to defend themselves against an unjustly issued enforcement permit. For this purpose, the debtor can file a so-called opposition claim (Oppositionsklage). The opposition claim asserts objections to the claim that have occurred after the judgement that is sought. In other words, facts must be asserted and proven which cancel the substantive claim (eg, fulfilment, novation, set-off, debt waiver, settlement, limitation period) or suspend it (eg, deferral). The court may suspend enforcement until a decision has been made on the opposition claim if it the purpose of the opposition claim would otherwise be frustrated. If the opposition claim is successful, the enforcement proceedings will be terminated.

Furthermore, the debtor can file a claim for the cancellation of an enforcement permit (Impugnationsklage). With this claim, the enforcement judgement is contested on formal grounds – eg, because the claim is not yet due or enforceable, or because the creditor has waived the right to enforce the judgement. The court can also suspend enforcement until a decision has been made on the claim if the purpose of the claim would otherwise be frustrated. If the debtor’s claim is successful, the enforcement proceedings will be terminated.

If third parties are of the opinion that their assets and not debtor’s assets are affected by the enforcement proceedings, they can challenge the enforcement proceedings with a so-called claim for expropriation (Exzindierungsklage). This claim can also lead to a suspension of the enforcement proceedings. Furthermore, the enforcement proceedings in relation to the assets in question will be terminated if the action for expropriation is successful.

Unenforceable domestic judgments

Only performance judgements, ie, judgements that order the performance or omission of a specific action, can be enforced. All other judgements are not enforceable.

Register for domestic judgements

Liechtenstein does not keep a register for domestic judgments.

Foreign Judgments

Legal issues concerning enforcement of foreign judgments

It should be noted that enforcing foreign judgments in Liechtenstein is inherently challenging. This complexity stems from Liechtenstein’s practice of enforcing foreign judgments only if there is a bilateral enforcement treaty with the relevant jurisdiction or reciprocity regarding the enforceability of foreign judgments with the specific foreign country. In the absence of such treaties or reciprocity, commencing a new civil proceeding before Liechtenstein courts is typically necessary.

Currently, Liechtenstein has enforcement treaties with two countries: the Austrian Republic and the Swiss Confederation.

In cases where no enforcement treaty or reciprocity exists, there is another significant procedural avenue available to enforce a foreign judgment in Liechtenstein. A creditor holding a foreign judgment may apply for a payment order (Zahlbefehl) at the District Court against the debtor named in the foreign judgment. With this application, the creditor seeks payment of the specified amount from the debtor. Filing this application initiates the payment order proceeding (Zahlbefehlsverfahren) before Liechtenstein courts. Once served to the debtor, the debtor has a 14-day period to file an objection (Widerspruch) to the payment order. Failure to file an objection within this timeframe results in the payment order, based on the foreign judgment, becoming legally binding. Consequently, such a payment order serves as a separate enforceable title in Liechtenstein alongside the foreign judgment.

If the debtor files an objection, the creditor as applicant for the payment order may initiate a debt enforcement proceeding (Rechtsöffnungsverfahren) to contest the debtor’s objection. This involves the creditor providing either an acknowledgment of debt from the debtor or a public document establishing the claim; foreign judgments are typically considered public documents. If the debtor’s objection is removed by the court in the course of the debt enforcement proceeding, the debtor may file a lawsuit for annulment (Aberkennungsklage) with the District Court. This action challenges the creditor’s claim based on the foreign judgment on its merits in an ordinary civil proceeding. Liechtenstein courts in such proceedings are not bound by the foreign judgment and may independently determine the existence of the claim.

If the application to lift the objection is denied, the creditor has the option to appeal this decision at the Court of Appeal. Should the denial be upheld, the creditor is left with the recourse of initiating an ordinary civil proceeding before the Liechtenstein courts.

Variations in approach to enforcement of foreign judgments

In Liechtenstein, only foreign civil judgments can be enforced. The enforcement treaties with Switzerland and Austria specify several requirements that these foreign civil judgments must meet for enforcement purposes in Liechtenstein. These requirements include, among others, the international jurisdiction of the court that issued the foreign judgment, such as an agreement on jurisdiction, the residence of the original defendant or the location of any involved property.

Categories of foreign judgments not enforced

The enforcement authorities in Liechtenstein only enforce foreign civil judgments. Under the existing enforcement treaties with Austria and Switzerland, claims arising from criminal proceedings or any interim orders cannot be enforced. The same restrictions apply to decisions in bankruptcy matters or specific inheritance claims (Nachlassvertragssachen).

Process of enforcing foreign judgments

Creditors who can substantiate their claims with legally binding judgments from Switzerland or Austria initiate enforcement proceedings by submitting an application for enforcement to the District Court. The enforcement proceeding corresponds to that for domestic judgments.

If the District Court grants an execution permit based on a foreign judgment, the debtor may file an appeal (Rekurs) within 14 days with the Court of Appeal.

In addition, concurrently with or separately from the appeal, the debtor may lodge an objection to the execution permit at the District Court (note: the same instance that issued the execution permit). The objection must be filed within 14 days at the District Court, citing specific legal grounds as stipulated by law, such as if the enforcement of the foreign judgment would contravene Liechtenstein law. A hearing is convened to adjudicate the objection, and the District Court renders a final decision through a decree. This decision then may be appealed with the Court of Appeal.

Costs and time taken to enforce foreign judgments

The court costs for enforcing foreign judgments in Liechtenstein vary depending on the amount of the claim being enforced, ranging from CHF10.00 to CHF3,400.00. The time required to enforce a foreign judgment can be relatively lengthy, and largely depends on the debtor’s conduct, particularly their resistance. Generally, legal fees for enforcing foreign judgments are higher than those for enforcing domestic judgment.

Challenging enforcement of foreign judgments

As mentioned above, foreign civil judgments from Swiss or Austrian courts that have been granted an execution permit can be contested through an appeal (Rekurs) to the Court of Appeal within 14 days. Additionally, there is an opportunity to file an objection at the District Court within the same 14-day period. This process allows the District Court to review and potentially amend its own execution permit.

Arbitral Awards

Legal Issues concerning enforcement of arbitral awards

Arbitration awards from domestic arbitration courts are considered as legally binding and enforceable titles, just like the judgments of ordinary domestic courts.

Moreover, the New York Convention on Arbitration came into effect for Liechtenstein in 2011. It allows for the enforcement of arbitration awards from foreign arbitration courts in the country.

Variations in approach to enforcement of arbitral awards

Although a distinction is made between domestic and foreign arbitration awards, due to the New York Convention on Arbitration this distinction is primarily formal. Foreign arbitration awards can thus be enforced based on this Convention just like domestic arbitration awards. The only distinction for foreign arbitration awards is the special legal remedy of objection (Widerspruch) which can be raised against the enforcement of a foreign arbitration awards for specific severe reasons.

Categories of arbitral awards not enforced

Only foreign arbitration awards that do not fall within the scope of the New York Convention are not enforceable in Liechtenstein.

Process of enforcing arbitral awards

As long as there is an arbitration award from a domestic arbitration court or a foreign arbitration court based on the New York Convention, the arbitration award is generally enforceable in Liechtenstein. The following enforcement proceedings are generally the same as for judgments from domestic courts (see Enforcement of Domestic Judgements,above).

Costs and time taken to enforce arbitral awards

As previously mentioned, the procedure for enforcing an arbitration award is generally speaking the same as the procedure for enforcing a domestic judgment from the ordinary courts. Therefore, the court fees range from CHF10 to CHF3400, depending on the amount of the claim. However, in practice, enforcing a foreign arbitration award is typically more time-consuming for the attorneys involved and, therefore, more costly.

Challenging enforcement of arbitral awards

A foreign enforceable arbitration award that has only been contested abroad remains generally enforceable in Liechtenstein. To prevent enforcement in Liechtenstein, the arbitration award must be definitively annulled at the location where the arbitration court was seated.

In Liechtenstein, a domestic arbitration award can be judicially annulled by the Court of Appeal upon request. Such annulment requires certain serious flaws in the arbitration agreement or other formal prerequisites. In substantive terms, an arbitration award can only be annulled if it contradicts the fundamental values of Liechtenstein law (ordre public).

Apart from the annulment of a domestic arbitration award, a debtor of a foreign arbitration award has the option to challenge a favourable execution application (Exekutionsantrag) by filing an objection (Widerspruch) against the execution permit (Exekutionsbewilligung) for specific reasons.

In addition, the debtor of a domestic or a foreign arbitration award may file an appeal against the execution permit (Exekutionsbewilligung). The appeal decision may further be appealed before the Higher Appeal Court. Ultimately, there is in principle the possibility of challenging this decision at the Constitutional Court on the grounds of fundamental rights violations. However, in such an appeal proceeding, arguments can only be made against the execution authorisation (for example, against execution means) and not against the initial decision (arbitration award) to be enforced itself.